Memorandum submitted by Actal
REACTION FROM
ACTAL (THE
DUTCH ADVISORY
BOARD ON
ADMINISTRATIVE BURDEN)
ON THE
INQUIRY "THEMES
AND TRENDS
IN REGULATORY
REFORM" BY
THE REGULATORY
REFORM COMMITTEE.
Overview trends in the Netherlands
1. Actal was established in 2000 in
the Netherlands as the first European watchdog on administrative
burdens. Since 2000 a lot has evolved within the Netherlands
and within the EU on regulatory reform.
2. The Netherlands started with the aim
to reduce the admin burdens for businesses. As is the case in
many countries, regulatory burden is primarily approached from
an economic perspective ie the need for effective and simple regulation
in order to maintain/increase the level of competitiveness.
3. Since then citizens, professionals and
compliance costs were added to the Dutch approach. When it became
evident that 50% of the Dutch admin burden originated at the European
level, this led in time to a European approach on Better Regulation,
initiated during the Dutch EU presidency in 2004.
4. Cabinet Balkenende III achieved the first
25% net reduction of admin burdens for businesses. The new Cabinet,
Balkenende IV, set a second 25% reduction target for businesses
in 2007 and reiterated the aim to achieve the first 25% reduction
for citizens. An important shift was that more focus was given
to perception as the general belief was that the first 25% reduction
for businesses was hardly felt. A lot of reduction came apparently
from rules that were not longer applied or had little impact on
businesses. More attention needed to be given to clear results
and reductions that really did matter. In the current Dutch approach,
we see, therefore for professionals and citizens that the government
focuses primarily on the largest irritation factors. No objective
and thorough measurements exist for calculating the benefits of
better regulation.
5. Every new regulation passes through different
assessments. Unlike the UK, the Netherlands does not have one
integral impact assessment. Each assessment focuses on various
aspects, such as the added value of the regulation, its impact
on businesses or the quality of the legislation itself. The Netherlands
is working on a pilot to introduce in due time an integral impact
assessment. Actal endorses this approach. However progress is
still limited. In our view, it is not likely that the present
government will finalize the project.
Current developments
6. The implications of the recent economic
development have highlighted the belief, underlined by Actal,
that now it is even more important to come with clear, simple
and effective regulation that does not jeopardise the functioning
of businesses unnecessarily and in a disproportionate manner.
7. This is reflected in the Netherlands
recovery plan finalised on the 25th of March 2009. It states that
the implementation of measures leading to a reduction of regulatory
costs should be accelerated. According to the Cabinet this can
lead to a reduction of 1 extra billion Euros on top of the
already aimed €8.8 billion reduction which the Cabinet
should realise by 2011 (25% reduction target).
8. The recovery plan presents these reduction
measures as impulses to stimulate businesses. It is however unclear
how the recession will affect the broader picture of regulation
namely in the financial sector. The better regulation approach
will however only be successful if new or adapted regulations
do no undermine the regulatory burden reductions already achieved
and even more important, if new regulation is also designed in
a simple and targeted manner. This is the reason why Actal, with
success, has always pleaded for a net reduction target of 25%.
9. In the past we have seen that a crisis
often leads to more regulation, initiated on various governmental
levels (regional, national, European) such that the sentiment
is created that the problem has been tackled. It is essential
that in the current crisis, regulation in itself is not seen as
the solution. In order to be effective the source of the problem
needs to be addressed in a proportionate way, with a specific
focus/target.
10. To avoid instinct reactions leading
to new and not always effective regulations, the problem itself
needs to be analysed and addressed at the right level, ie national,
European or global. To achieve this, the discussion needs to be
technical as well as political. A possible tool would be to initiate
an impact assessment at the beginning of the process setting out
all relevant alternatives including the quantification of its
various impacts. The IA should be discussed intensively with the
most important stakeholders at different moments during the policymaking
process. Essential in this approach however, and this is the most
difficult in times of crisis, is that the final solution remains
open until the possibilities have been assessed from the relevant
perspectives taking account of the most important effects (effect
businesses, effect consumers, effect enforcement, effect market,
etc).
11. The inclusion of stakeholders in an
early phase and throughout the process is a precondition to make
it possible for the regulator to take in full account the perspective
of the targeted businesses, while making new policy. New regulation
can not just be a top down process to be effective. This inclusion
will make it possible to come with new legislation that fits into
the existing processes of the various firms. In other words, the
regulation needs to be more tailor-made in order for it to be
truly effective and efficient.
Design of new regulations
12. In the Netherlands the government is
aware that the inclusion of stakeholders within the policymaking
process is essential in order to make regulation effective. More
emphasis is needed however for the effect of regulation on small
businesses. There is a general awareness that small and medium
enterprises should not be hit disproportionately by new regulation
regarding the regulatory burdens. This is however not always reflected
in new regulation. When Actal scrutinises proposed legislation
from a department, a check is made on the proportionality of its
effect on businesses.
13. The last years have shown that implementation
is essential to look at when designing new regulation. This has
led within Actal to check all proposed legislation that is scrutinised
by Actal on enforcement and compliance issues. Departments work
more closely together with enforcement bodies when drawing up
new legislation.
14. Besides that, the Dutch Cabinet is drawing
up a baseline measurement on Compliance costs. This measurement
will be the base for future reduction measures on compliance costs.
15. More attention is also coming from the
Dutch Parliament on regulatory burden in a broader sense. The
parliament, for example, supported the advise of Actal on the
principle of Lex Silencio (if a citizen or a company does not
receive a reaction on a certain type of application (ie building
permission) on time from the government, the application/permission
is granted automatically). The parliament also demanded from the
government to submit the new recovery plan to Actal.
March 2009
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